Thank you, and good afternoon, everyone. Joining me on the call today are Bill Miller, Veeco's Chief Executive Officer; and John Kiernan, our Chief Financial Officer. Today's earnings release and slide presentation to accompany today's webcast is available on the Veeco website. To the extent that this call discusses expectations for future revenues, future earnings, market conditions or otherwise make statements about the future, these forward-looking statements are based on management's current expectations and are subject to the risks and uncertainties that could cause actual results to differ materially from the statements made. These risks are discussed in detail in our Form 10-K annual report and other SEC filings. Veeco does not undertake any obligation to update any forward-looking statements, including those made on this call, to reflect future events or circumstances after the date of such statements. Unless otherwise noted, management will address non-GAAP financial results. We encourage you to refer to our reconciliation between GAAP and non-GAAP results, which you can find in our press release and at the end of the earnings presentation. With that, I will turn the call over to our CEO, Bill Miller.

Thank you, Anthony. Veeco delivered strong financial performance, exceeding the high end of our guidance. Revenue totaled $166 million, non-GAAP operating income of $23 million and non-GAAP EPS of $0.36. Our semiconductor business posted another robust quarter, highlighted by record revenue for our advanced packaging systems. This revenue was driven by growing demand from AI by a broad base of customers, including leading foundries and OSATs. Additionally, we had increased revenue for our ion beam deposition systems for EUV mask blanks and continued demand for our laser spike annealing systems with shipments to leading customers supporting gate-all-around and high-bandwidth memory applications. I'll now provide an overview of our role in the semiconductor manufacturing process and an update on key technologies. Veeco technologies remain critical for several leading -edge semi manufacturing process steps. Veeco is a market leader in laser annealing with our laser spike annealing system qualified as production tool of record for leading logic customers and 1 Tier 1 DRAM customer. Our next-generation nanosecond annealing system expands our capabilities to enable new applications, and we're pleased to report our evaluations at advanced logic customers are progressing well. Equally as important, interest from additional logic and memory customers to evaluate our NSA system remains high. Veeco is also the market leader for deposition of defect-free films for EUV mask blank production with our IBD EUV system. Our ion beam deposition technology is critical to the industry's roadmap, and we're in a strong position to support demand for EUV lithography. We also see opportunities to expand our business into adjacent mask blank steps. Growth in AI is accelerating the adoption of new technologies and materials that enable continued device scaling and address the increasing demand for energy-efficient compute performance. As device geometry shrink, traditional approaches are falling short of meeting resistivity…

Thank you, Bill. Starting with revenue for the quarter. Revenue came in at $166 million, above the high end of our guidance, slightly down sequentially and down 6% from the prior year. In our guidance for the quarter, we took into consideration the then imposed substantial import tariffs in China for goods manufactured in the United States. We reported certain China customers were delaying shipments due to the tariffs and the midpoint of our guidance range assumed $15 million of shipments would be delayed outside the quarter. During the second quarter, as the tariff rate was significantly reduced, customers accepted the majority of shipments that were previously delayed. Our semiconductor business had another strong quarter, flat sequentially and growing 13% year-over-year, representing 75% of total revenue. Year-over-year growth was led by strong performance for our ion beam systems for EUV mask blanks and wet processing and lithography systems for advanced packaging applications. In the compound semiconductor market, revenue was flat from the prior quarter at $14 million, totaling 9% of revenue. Data storage revenue increased to $12 million, totaling 7% of revenue, in line with our expectations. Also in line with our expectations, scientific and other revenue decreased to $16 million, totaling 9% of revenue. Turning to quarterly revenue by region. Revenue from the Asia Pacific region, excluding China, was 59%, an increase from 36% in the prior quarter. This increase was led by sales in Taiwan and Southeast Asia for advanced packaging as well as ion beam deposition for EUV mask blanks. Revenue from China customers decreased in Q2 from Q1 with the percentage of revenue decreasing to 17% from 42%. China was 30% of first half of the year revenue, in line with our initial expectations coming into the year. The United States came in at 13% and…

My first is just around the quarter. So you took out some impact from China, but it looks like you got that back in the numbers. When I look at the geographic exposure, China does come down and the rest of world goes up pretty significantly. I think quarter-over- quarter, it was up 64%. So are you shipping these products to other locations and then they're making their way to China? Or are these different customers that are filling in the gap here? If you could just help put those together, I would appreciate it.

Sure. So Tom, this is John. Thanks for the question. No. This is the delayed shipments that we expected at the beginning of the quarter that were being delayed because of the higher tariffs in China. Customers then when the tariffs got significantly reduced, rescheduled shipment during the quarter and accepted those shipments. So China was expected even with those shipments in it to be down in the second quarter compared to the first quarter and it has come in rarely right where we expected coming into the year. So for the first half of the year, revenue to China customers was about 30% of revenue.

Okay. So the 2 are unrelated. So I guess when you look at the back half of the year, you had previously kind of taken out $10 million to $15 million or so of continued impact from products that you were unable to ship. Is your view now that you're able to ship those and that customers are going to take those? Or are you still remaining cautious? Just you're obviously getting it back in June, do you put it back in for the rest of the year as well?

So I think, Tom, for our view coming into the year, irrespective of tariffs that China revenue is going to be about 30% in the first half of the year and sort of lesser in the second half of the year. And generally in the semiconductor piece of the business because less investments in new 28- and 40-nanometer fabs where that was really the sweet spot for where our equipment was going. I think the year is playing out as we expected it to play out there. And now we expect somewhere in the range of about 20% of revenue for the second half of the year coming from China. So no change in expectations. The delay in tariff shipments was a onetime thing in Q2 that right now has been totally resolved. [ id="-1" name="Operator" /> The next question we have is from Rich Schafer of Oppenheimer & Co.

I guess my first question, if I could, you guys. One of your largest U.S. IDMs customers has become pretty publicly more cautious around spending on advanced nodes and -- so it's sort of like no more -- I guess, no more build -- if you build it, they will come add there. So does that affect or how does that affect your TAM outlook for NSA and ion beam for metal resistivity? I mean both of those kind of come to mind. And anything else you might highlight that might be impacted by that pivot?

Yes, Rick, I mean -- it's a great question. I would say, obviously, this IDM is trying to transition to a foundry and using your baseball analogy, if you build it, they will come, doesn't really work in a foundry model. And I think that makes a lot of sense for them. That being said, we are working with all the leading logic players on their next nodes, and we're continuing to partner with that IDM on helping them develop their core building blocks and key technologies that they need to enable in R&D to enable their next node. So it's not really impacting our business in the short or midterm. We're continuing to work with them. And HBM for that is still a few years out. And of course, is subject to risk as all R&D investments are.

And if I could, maybe just a follow-up. You mentioned -- John maybe mentioned GaN power kind of briefly in a list of drivers for the business. So you've had that MOCVD eval, I think, going on for a few quarters now. I just was curious if you could give any more color on that eval, mostly around timing, like a sense of timing? Like are you targeting revenues there? Could they hit this year? Is it really more of a '26 driver? And sorry if I missed that in what you said, John, but I just was a little kind of curious about where we are there.

Yes. The 300-millimeter GaN on silicon evaluation system we have in the field is progressing well. We've received very positive feedback from our customer. And we're pretty excited about it because this customer has kind of a long-term view of 300-millimeter GaN on silicon. And assuming success, the plan would be to have this drive pilot line business for us starting in '26. So kind of a bit of a step-up and then ramping to high volume in '27 and beyond. So pretty exciting stuff for us. [ id="-1" name="Operator" /> The next question we have is from Charles Shi of Needham & Company.

Two questions here. Maybe I'll continue on that GaN on silicon. I want to dig a little bit more into the competitive dynamics here because we do recognize you have a European equipment competitor who has also historically been very strong in compound semi, especially when it comes to power. And how do you characterize why you are able to win and -- with the potential to win here? And what differentiates you from your competitor? That's my first question.

Charles, I would say over the last few years in MOCVD, in particular, we've had a concerted effort to upgrade our product lines. specifically in 300-millimeter GaN on silicon and in the batch arsenide phosphide tools. And what we're seeing is that as we're putting them out there that we are gaining some traction in the marketplace relative to competition. So specifically in GaN on silicon at 300 millimeters, we see that we're competitive from a productivity and cost of ownership standpoint while maintaining excellent process performance, meeting the customers' specification. And in the arsenide phosphide tool set, -- we're working with a number of customers, for example, in low earth orbit solar activity. There's some opportunities there, microLED and indium phosphide applications in the data center. So we're working with a number of customers and some of the feedback we're receiving is that we're really differentiated on a performance with a lower cost of ownership for our customers. So yes, it seems that it's been a bit of a long road, and we still have a ways to go. But early returns on the products seem to be going in the right direction.

So the second question, maybe this is for John. I want to ask you a little bit more on your China commentary. It sounds like you're kind of guiding to like 20%-ish of the revenue in second half of the year will be coming from China, but that would imply a pretty big down versus the first half. But on the other hand, we've been hearing from your peers pretty meaningful China upside. So China WFE upside over the last 2 or 3 weeks. And so I wonder you have embedded some of the upside in that second half guidance already? Or did your expectation for China come up over the last 90-ish days? And I want to know if you think there's more to the numbers you just said 20%.

Sure, Charles. So again, a lot of the business that we drove the last couple of years in China was for laser annealing equipment and principally in new greenfield fabs at 28 and 40-nanometer. We see continued investment and in that 20% revenue for the second half of the year, we're continuing to get business for LSA with existing customers, and we are seeing new customers come in here. I would say we really see that this playing out fairly the way we expected it to play out for the year. So we are having ongoing business, just not at the pace of the last 2 years. [ id="-1" name="Operator" /> The next question we have is from Mark Miller of Benchmark.

I'm just wondering if you're seeing any impact from the tariffs in terms of -- from your component suppliers increasing costs? Or do you expect any?

Yes. So Mark, we have seen in terms of tariffs that we import ourselves from Europe and Southeast Asia as the principal areas that we import directly ourselves for our supply chain, and we are seeing tariffs there. And it's about 100 basis point impact in our actual results for Q2, and we're forecasting a similar result in Q3. We are seeing potential for increases in price from domestic suppliers that also have an international supply chain there. And I would say we continue to work with those suppliers to try to mitigate the impact from those tariff increases or potential increases from our domestic suppliers.

You mentioned an opportunity in quantum computing for what equipment is that for IBD?

No, Mark. It's for our -- mostly our molecular beam epitaxy equipment or MBE equipment as well as some ALD equipment for researchers in the quantum computing space. So really MBE. [ id="-1" name="Operator" /> The next question we have is from Gus Richard of Northland Capital Markets.

You guys have a sort of a unique visibility across the industry. You're involved with litho. You're involved with backside power, you're involved with advanced packaging and even transistor structures like gate-all-around and CFET. So my question is, which technology are people hot to try? Where are you seeing the most activity? Where are things getting pushed the hardest?

Gus, I would say it's really driven by AI, high-performance computing and high-bandwidth memory. And so our advanced packaging business is doubling in '25. Really seeing a lot of strength and a lot of pull in wet processing there. We're really engaged with leading foundry, HBM manufacturer as well as OSATs there, and we're really expanding that business very solidly. And likewise, in litho, our business is improving over '24 and will be a driver of growth for us in applications like not only AI and high-performance computing, but also mobile in litho. And then the -- besides advanced packaging, I would say the second major area for growth for us kind of at the leading edge is in gate-all-around, where we're seeing a fair amount of -- a lot of growth there year-over-year in '25. So I would say it's really kind of transistor -- advanced transistor on the logic side and then wet processing on -- excuse me, in advanced packaging type applications for AI, high-bandwidth memory, et cetera.

Got it. Got it. That's helpful. And then my second one is there's not a lot of hard disk drive guys, so I'll say the customer's name. Seagate, I believe, doubled their CapEx. You're already seeing an increase in spares and service. Is there more upside in spares and service? And if you're starting commercial negotiations, as I recall, the lead time is 3 quarters. Do you see potential systems shipping for the HDD market in the second half of '26.

Yes. I would say customers have continued to bring capacity online. Clearly, their utilizations are increasing, and we've seen that read out in our service numbers here throughout the first half of '25. I would say to your point there, we actually are quite encouraged by increased engagement with not only one but the other as well in terms of commercial discussions with our customers about their future requirements. And you're right about the lead time. And so these are all very positive signs that they could be ordering some more equipment here. So it's positive. We don't have purchase orders in hand, but these are the signs of positive signs, I would say, for the data storage industry. And obviously, you kind of quoted there increasing CapEx percentage on increasing revenues. That's obviously a good sign. [ id="-1" name="Operator" /> At this time, we have no further questions. And I would like to turn the call back over to Bill Miller for closing remarks.

Yes. I'd like to thank our customers and shareholders along with the Veeco team for their continued support, and have a great evening. Thank you. [ id="-1" name="Operator" /> Ladies and gentlemen, that concludes today's conference. Thank you for joining us. You may now disconnect your lines.